This week's blog post is authored by Paul Schreyer, the Director of JOC Operations for the Northeast Region.
Natural disasters and mechanical failures, such as a water line break or a bridge bearing failure, can create an emergency event that requires an immediate response to stabilize the building, site or impacted area, to clean up, and to make the required repairs.
Under those circumstances, every public owner is given the opportunity to engage contractors and other service providers quickly without following the traditional time consuming competitive bidding requirements. That expedites the required response, and meets immediate needs, but does little to control costs.
If the occurrence is a natural disaster impacting a large geographic area, the public owner may be eligible for federal reimbursement through FEMA funds. However, certain recordkeeping requirements and procurement guidelines must be followed to qualify for reimbursement. Procurement officials need to provide complete and timely documentation to support the purchases made during the disaster. NASPO – Emergency Preparedness for State Procurement Officials, August 2008.
Many public owners have emergency response procedures and plans which include lists and contact numbers for prequalified contractors and service providers. However, not all owners have prepriced contracts in place.
For over 30 years, Job Order Contracts have provided facility and infrastructure owners with the ability to accomplish a substantial number of individual construction projects with a single, competitively-bid contract. Contractors bid a multiplier to be applied to a catalog of tasks with preset unit prices developed using local labor, material and equipment costs. Job Order Contracts are generally awarded to the lowest, responsive, responsible bidder. Once the contract is awarded, the owner can have the contractor perform a variety of projects. The contractor is paid the preset unit price x the quantity ordered x the competitively bid adjustment factor. No negotiation required.
Traditionally, Job Order Contracts have been used for planned maintenance, repair, renovation and demolition work. Recently however, several owners have determined that the Job Order Contract structure and pricing is effective in responding to natural disasters and other emergency situations.
The University of Vermont established an emergency response Job Order Contract for mold and water damage. Vermont winters are cold. The University has a significant number of historic buildings. No matter how diligently they plan and how many precautions they take, they experience water line breaks in the winter. Whether it’s a dormitory or a classroom, it is essential to respond to the event quickly. Stop the leak, and clean up the area.
The University had a successful general construction Job Order Contracting program. They determined that having on-call contractors capable of responding quickly to emergency water damage events with fixed pricing for all work performed simplified the process and guaranteed the university would not overpay for the emergency services. The University competitively bid and awarded an emergency response Job Order Contract. To date, the program has been very successful.
Similarly, the New York City Department of Education has been using Job Order Contracting for routine renovation, repair and upgrade construction projects for 18 years. The Department manages 1,200 school buildings and related facilities. Following Hurricane Sandy, the Department called upon its Job Order Contractors to perform remedial work at some schools damaged by the storm. Thereafter, the Department decided to put in place three competitively-bid, on-call emergency response Job Order Contracts to respond to future events. The emergency response Job Order Contracts contain preset unit prices for all types of labor, materials, equipment, and construction work that may be needed to stabilize the building and perform clean-up work. Although the unit prices include hourly rates for labor and daily, weekly, and monthly rates for everything from axial fans, bobcats, and temporary generators, they put an emphasis on including tasks that are for a measurable amount of work – e.g. square foot of plywood used to board up windows, square yard of carpet removal, cubic yard of imported gravel, etc.
The Pennsylvania State University is also expanding its Job Order Contracting program to add Emergency Response Job Order Contractors capable of responding to emergency events at any campus located throughout Pennsylvania.
Emergency Response Job Order Contracts provide facility and infrastructure owners with prequalified on-call contractors ready to respond to emergency events quickly at preset unit prices for all labor, material, equipment and services.
The detailed cost information provided by the contractors, fixed through competitive bidding, will also meet the requirements for reimbursement from FEMA or the owner’s insurance carrier.
