Ch. 14 Bidding and Negotiation Contracts

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NCIDQ Ballast 5th Edition

Negotiated contract

One selected contractor negotiates a contract with owner

Bid contract (or tendered)

Several general contractors bid the work.

AIA Document A701

Instructions to bidders

Pre-qualification

Allows the owner to select a contractor that meets certain standards are experience, financial stability, and performance.

Two ways to notify prospective bidders of a project

First, Advertising in newspapers and trade journals
Second, invitation to Bid

Advertisement for bids are usually required for __ work.

Public

An invitation to bid is sent.

to pre-qualified prospective bidders

Bid documents are made available by the interior Designer and include:

Drawings
Specifications
Bidding documents
Bid forms

Usually bidders put down a deposit

on drawings and it is returned after bidding

Bidders

are required to submit requests for approval for substitutions 10 days before bid opening with backup info on substitutions.

addendum
all bidders

If substation is approved interior designer issues an _____ and is required to send it to _____.

Addendum

A written or graphic document issued by interior designer before execution of contract that modifies bidding documents by additions, deletions, clarifications, corrections. Addenda (plural) are issued no later than 4 days before bids are submitted.

Pre-bid conference

Meeting with designer, owner, architect and consultants and bidders where bidders can ask questions

Who is present? who prepares the bid log and who is it issued to?

Owner, Designer and all Bidders
Designer
All bidders

What does a bid log include?

Base bid amount, amounts of alternates, whether receipt of any addenda was acknowledged. The Bid log is then made available to all bidders in open or private bidding.

10. Decision is sent to all the bidders.

Usually a bid is awarded in __ days.

If all bids exceed project budget the owner has what four options?

Rebid
Authorize increase in construction cost and proceed with project
Work with designer to revise scope and reduce cost
Abandon Project

Bidding documents include:

advertising or Invitation to bid
Instructions to bidders
Bid forms
Bid security information
Requirements for performance bond
Requirements for labor and material payment bond

Other documents often added to the bid from include:

Qualification forms
Subcontractor list form
Requirements for certificates of insurance and compliance to laws.
Drawings of existing construction

AIA Document A701

Instructions to bidders- Outlines the procedures and requirements that the bidders must follow in submitting bids, the bids will be considered, submittals required and how to submit bids.

What is included in the A701 Document Instructions to bidders?

Consideration of bids
Bidder's Representation
Bidding documents.
Substitutions
Bonds (performance and payment)
Addenda
Modification or withdrawal from bid
Post-bid information

Consideration of bids

the procedure for opening bids and reviewing them include under what conditions bids may be rejected, how they will be evaluated and conditions for award of the contract

Bidder's Representation

the bidder represents that he or she has read and understood the documents, reviewed the plans and specifications, and visited the site

Bidding Documents

states where the documents may be obtained, how many sets of documents the bidder may obtain, and the amount of deposit for the documents
-10 days after receipt of bids , the deposit is returned to bidders

Substitutions

the materials and products described on the drawings and specifications establish a standard for the work
-must meet standards
-bidders are required to submit 10 days prior to the bid opening date

Bonds

the cost of bonds are included in the bid amount unless they are required to be furnished after the receipt of bids and before execution of the contract

Interpretation or correction of bidding documents

bidders must make a written request that must reach the interior designer at least seven days prior to bid date

When are addenda issued?

During bidding process before bids are submitted.
-no later than four days prior to the date of bid opening

Modification or withdrawal of bid

-may not be modified after the designated bid time and date
-may be modified or withdrawn by making notice in writing over the signature of the bidder

Post-bid information

owner may want the conractor to submit:
-a designation of the work to be performed with the contractor's own forces
-the names of the manufactures and suppliers
-the names of persons or companies proposed to perform major portions of the work

Bid forms

A standard form the bidder enter required information. Makes it easier to compare and evaluate bids.

Bid forms Include:

Amount for base bid
Price for alternates
Unit prices
Number of calendar days to complete work.

Bid security

A certified check, or bid bond to ensure successful bidder will enter into contract with owner.

Amount of bid security is:

A fixed price or percent of bid, usually 5% of bid price

Performance bond

A statement by surety company that construction will be completed if the contractor defaults on obligations. Owner either receives money or Surety will hire another contractor to complete work.

The cost of a performance bond is usually

3% of construction cost

Performance bond is paid by who?

Owner

Labor and material payment bond

Protects the owner against liens on property or litigation by subcontractors. resulting form non payment of materials and labor by defaulting contractor.

Cost control

-the bid price should be fairly close to the estimated construction cost
-the interior designer does not guarantee that the actual construction cost will not vary from the estimate

Alternates

request included in the bidding documents asking the contractor to supply a price for some type of variation from the base bid

Add alternate

Adds to base bid amount

Deduct alternate

Reduces base bid amount

Unit prices

set costs for certain portions of the work based on individual quantities such as linear feet or square yards of installed material.

Allowances

Set amount of money estimated by the interior designer to cover a particular material. A way to allocate amount even if quantity or quality is not known.

Negotiation

Selecting a contractor:
1-the owner may know precisely which contractor he or she wants to complete the project
2-owner may select several possible contractors to be interviewed/selected based on qualifications and fee proposal

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