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Pages 59-89

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From page 59...
... c. A best-value award algorithm is then selected based on the scope and complexity of the given project, and the best-value RFP will be published detailing both the award algorithm and the requirements to submit information and documentation to be responsive to the best-value evaluation plan.
From page 60...
... P.1 25 Key Personnel & Qualifications P.2 41 Utilization of Small Business P.3 30 Subcontractor Evaluation/Plan P.3 29 Management/Organization Plan P.4 31 Quality Management Q.4 27 Proposed Design Alternate D.0 26 Technical Proposal Responsiveness D.1 37 Environmental Considerations D.1 25
From page 61...
... Also might include past history of claims and litigation Preference is given to offerors with the most relevant experience P.2 Key Personnel Experience & Qualifications Qualifications of key personnel Licenses, registrations, and past project experience of individuals Subcontractors' Information Subcontracting plan including small business utilization Often requires that goals for participation by certain types of firms be met Project Management Plans Plans for logistics, material management, equipment, traffic control, etc. Often related to schedule constraints Safety Record and/or Plan Corporate safety record and plans for specific safety hazards Often uses the Workers' Compensation Insurance Modifier as a metric to measure safety record Quality Quality Management Plans Typical QA/QC program submitted prior to award May include design QC if bid alternates or DB is used Design Alternates D.0 D.1 D.2 posed Design Alternate Owner allows contractor to propose an alternate material or technology for a given feature of work Bid is submitted with and without alternates.
From page 62...
... Summary of best-value award algorithms. Best-Value Award Algorithm Algorithm Variables Award Determination Meets Technical Criteria -- Low Bid If T > T min, Award to Pmin If T < T min, Non-Responsive T = Technical Score P = Project Price Lowest Price Adjusted Bid AB = P/T Award ABmin AB = Adjusted Bid Adjusted Score AS = (T x EE)
From page 63...
... Best-Value Award Algorithms Number of Transportation Agencies Using Award Algorithm Number of Horizontal Case Study Projects Using Award Algorithm Meets Technical Criteria–Low Bid 7 19% 6 21% Adjusted Bid 7 19% 3 11% Adjusted Score 6 17% 1 4% Weighted Criteria 8 22% 3 11% Quantitative Cost-Technical Tradeoff 2 6% 3 11% Fixed Price–Best Proposal 1 3% 0 0% Qualitative Cost-Technical Tradeoff 5 14% 12 42% Totals 36 100% 28 100%
From page 64...
... Cost-Technical Tradeoff (Qualitative) To implement this best-value award algorithm, the owner will follow the process that is illustrated graphically in Figure 3.3.
From page 65...
... e. Best-value proposal evaluation plan listing the technical, schedule, and cost evaluation criteria with corresponding standards f.
From page 66...
... This is the most subjective of the three best-value award algorithms, and as a result, it will be the least popular to implement. However, numerous conversations with procurement officials in the federal sector indicate that they have had more award protest problems with the quantitative costtechnical tradeoff than with this more subjective approach.
From page 67...
... Drop from Competition Step 1 Step 2 No No Yes Yes Announce Competitive Range Publish BV Request for Proposals BV Proposal (BVP) {BVPi to BVPn} Sched {SCi – SCn} Tech {TCi – TCn} Develop Evaluation Criteria Qual {QCi – QCn} Statements of Qualifications (SOQ)
From page 68...
... Cost-Technical Tradeoff (Qualitative) Value Unit Price Price Price: A.0 X X X Time Schedule: B.0 X X X Cost Cost: C.0 X X Qualifications Prequalification: P.0 X Past Project Performance: P.1 X X Key Personnel Experience: P.2 X X Subcontractor Information: P.3 X X Project Management Plans: P.4 X X X Safety Record/Plan: P.5 X X Quality Quality Management: Q.0 X X X Design Alternates Design with Proposed Alternate: D.0 X X Technical Proposal Responsiveness: D.1 X Environmental Considerations: D.2 X X Rating System Satisficing Adjectival or ModifiedSatisficing Direct Point Scoring Table 3.5.
From page 69...
... BV Award Algorithm Selected Based on Selected BestValue Award Algorithm Move to Flow Charts Shown in Figures 3.2, 3.3, & 3.4, and Skip Screening Steps Yes No Complex Simple Project Selected for BV Award Cost Savings Benefits Time Savings Benefits Quality Enhancement Benefits Qualifications Benefits Use CostTechnical Tradeoff BV Award Algorithm Select BV Schedule Parameter & Criteria B.0 Select BV Design Alternate Parameter & Criteria D.0 – D.2 Select BV Qualifications Parameter & Criteria P.0 – P.5 and/or Q.0 Use Value Unit Price BV Award Algorithm
From page 70...
... 5. If the project's scope of work is judged to be complex, then the owner must decide whether it will use the costtechnical tradeoff or value unit price award algorithm.
From page 71...
... Three examples are provided to allow the reader to see the dynamics of each of the proposed best-value award processes. Meets Technical Criteria -- Low-Bid Award Algorithm Example Starting with the simplest award algorithm, meets technical criteria -- low bid, a hypothetical chip seal project will be introduced.
From page 72...
... Best-value selection on example project technical score breakdown. Totals Technical Score Breakdown Firm Time Price Proposal Tech.
From page 73...
... Cost-technical tradeoff best-value selection on example project technical score/adjectival breakdown. Totals Technical Score Breakdown Firm Time Price Proposal Tech.
From page 74...
... Evaluated Values Adjusted Values 85% Price/15% Technical 50% Price/ 50% Technical 15% Price/ 85% Technical Firm Time Price Proposal Tech. Score Adjusted Score Adjusted Price Total Score Total Score Total Score A 450 $11,880,000 92 100 78 80.90 88.76 96.63 B 460 10,950,000 86 93 87 88.07 90.30 92.52 C 500 9,850,000 76 83 98 96.08 90.53 84.99 D 500 9,760,000 74 80 99 96.54 89.91 83.28 E 500 9,700,000 68 74 100 96.09 86.96 77.83 an extra $90,000 (less than a 1% increase)
From page 75...
... Additionally, the agency's project goals and performance measures must be considered in the decision to select a project for a best-value procurement approach. For example, the use of a past experience/past performance evaluation criterion is appropriate when high precision or quality is considered critical, and the use of a project schedule evaluation is appropriate when user delay costs are a significant concern.
From page 76...
... Initial construction cost savings will only be realized when there is an opportunity for contractors to save money through schedule compression, the application of innovative means and methods, or more constructible designs. Adding best-value selection criterion such as an exemplary safety record, past performance, and management plans may in fact add to the initial construction price.
From page 77...
... Quality Requirements Where low-bid methods typically only stipulate minimum quality requirements through contract specifications, bestvalue procurement allows for quality-related elements to be included as part of the competition. Quality management plans and tighter tolerance on materials or end products are two examples of items that can be factored into the evaluations.
From page 78...
... Each agency must carefully examine its enabling authorization in determining how to proceed with a best-value procurement. In addition to reviewing the Model Code and statutes identified in Appendix B, agencies wishing to obtain general bestvalue legislation may want to review the enabling legislation allowing use of design-build for transportation projects.
From page 79...
... In 2000, after many years of research, analysis, and discussions, the ABA issued a revised Model Procurement Code that can be used as the basis for legislative changes. As described in Section 2.2, the Model Code allows use of a "competitive sealed bidding" process so that the project owner can award to the responsive bidder who provides the lowest priced bid (i.e., using the meets technical criteria -- low-bid algorithm)
From page 80...
... • Concerns regarding the subjectivity inherent in a bestvalue selection process make contractors reluctant to participate in best-value procurements. • The use of alternate bids or design alternates in the context of competitive bidding in the United States is limited to specific material or equipment items, pre-engineered items, and specific construction processes rather than complex designs such as buildings or bridges.
From page 81...
... The Comptroller General rejected this argument, noting that source selection officials have broad discretion to determine the manner and extent of technical and price evaluation results under a negotiated procurement: In deciding between competing proposals, price/technical tradeoffs may be made; the propriety of such tradeoffs turns not on the difference in technical scores or ratings per se, but on whether the source selection official's judgment concerning the significance of that difference was reasonable and adequately justified in light of the RFP evaluation scheme. ...The discretion to determine whether the technical advantages associated with the higher-priced proposal are worth the price premium exists notwithstanding the fact that price is equal to or more important than other factors in the evaluation scheme.
From page 82...
... An agency implementing best-value procurement for the first time would be more inclined to select a system, for example a one-step meets technical criteria -- low-bid system, more closely aligned with its traditional procurement process. With more experience, the agency might move to a more sophisticated or complex best-value model similar to the approaches used by the federal agencies with significant best-value experience.
From page 83...
... award process, it is often advantageous to establish pass/fail or minimum performance criteria to determine bidder responsibility and whether the bidder's technical proposal is responsive. Responsibility can be addressed through prequalification, whether through a blanket prequalification for multiple projects, or through prequalification/shortlisting as the first step of a two-step, best-value procurement.
From page 84...
... • Address methods of selecting projects, parameters, and best-value procurement systems. • Provide guidance for evaluation and scoring of technical proposals.
From page 85...
... based on project objectives identified in the project screening process. Parameters may include time, qualifications, quality, design alternates, or some combination of these factors aligned with the project objectives.]
From page 86...
... BV Award Algorithm Algorithm Variables Meets Technical Criteria -- Low Bid If T > Tmin, Award to Pmin If T < Tmin, Non-Responsive T = Technical Score P = Project Price Value Unit Price (Weighted Criteria)
From page 87...
... Award will be determined by the lowest priced, fully qualified offeror. A generic algorithm and example follow: Algorithm: If T > Tmin, Award to Pmin If T < Tmin, Non-Responsive T = Technical Score P = Project Price Award Algorithm BV Parameter and Evaluation Criteria Meets Technical Criteria -- Low Bid or Low Cost Value Unit Price (Weighted Criteria)
From page 88...
... Price Proposal 1 51 $1,400,000 2 53 $1,200,000 3 44 $1,100,000 4 39 NR Value Unit Price Example Offeror Technical Score (60 maximum) Price Proposal Price Score (40 maximum)
From page 89...
... There will be those projects that should not be procured using a best-value contract, and they should remain in the procurement realm defined by the lowest responsive bid. Thus, the coupling of the best-value project screening and selection tool to the best-value procurement system using the parameters, evaluation criteria, rating/scoring system, and award algorithm is both logical and essential to the successful implementation of best-value contracting for highway construction projects.Agencies should also be open to use of adjectival rating systems, based on recommendations from federal agencies that the best results are achieved with such a system.


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