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Day 4: Contract Perfection and Applications of Contract Conditions: Case Studies and Group Workshop
Day 5: Design-Build, Integration and Examination
Part I
Sec. I - Invitation to Apply for Eligibility and to Bid (IAEB) Sec. II - Eligibility Requirements (ER)
Part II
Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec.
I - Instructions to Bidders (ITB), incldg Docs comprising bid II - Bid Data Sheet (BDS) III - General Conditions of Contract (GCC) IV - Special Conditions of Contract (SCC) V - Specifications VI - Drawings VII - Bill of Quantities (BOQ) VIII- Forms
Description (2)
PE shall specify data for Col. (1) to (4) Bidders shall fill in unit and total bid prices in Col. (5) and (6)
Philippine Bidding Documents harmonized between GOP and ODA agencies (ADB, WB, JBIC) for national competitive bidding (NCB) SBDs customized to agency e.g., DPWH SBDs
BDs are for a particular contract, which shall adopt the SBDs but with contract-specific info in:
SBDs and BDs should be downloadable at agency website. FIDIC Conditions of Contract for international competitive bidding (ICB)
Mayors business permit/city or municipal license* BIR tax clearance Non-inclusion in blacklist * Proposed in new IRR
Technical requirements:
Work experience - Completed similar project >= 50% of ABC*
NFCC must = at least ABC* NFCC = [(current assets current liabilities) K] - value of all outstanding works under on-going and unstarted awarded contracts coinciding with the subject contract, where K = 10 if contract duration is 1 yr or less, 15 if duration is > 1 yr up to 2 yrs, 20 if duration is > 2 yrs Credit line commitment must = at least 10% of ABC* Cash deposit certificate must = at least 10% of ABC
Class A documents
Legal documents: 1. DTI or SEC registration.* 2. Mayors permit/municipal license.* 3. TIN. 4. Bidders statement that it is not blacklisted. 5. Other licenses required by the entity. 6. Tax clearance 7. Tax returns filed and paid thru EFPS 8. Certificate of PhilGEPS registration. Technical documents 1. Bidders statement of on-going, completed and awarded but unstarted contracts with value of work, CPES, etc.* * Proposed in new IRR
1. Audited financial statements, received by BIR.* 2. Bidders computation of NFCC or credit line commitment or cash deposit certificate.*
Class B documents 1. Joint venture agreement, in case of JV. Each JV member shall submit required eligibility documents.* 2. Letter authorizing BAC to verify documents.
* Proposed in new IRR
Contractor may download LOI form from agency website, or obtain hard copy from BAC. Contractor submits accomplished LOI (with CRC in the case of DPWH). LOI indicates:
Contractors intention to apply for eligibility If found eligible, commitment to submit a bid and purchase BDs.
Content of LOI:
It is not within relationships prohibited by Sec. 47 of RA 9184. If its NFCC is less than ABC, it is submitting a credit line commitment or cash deposit certificate = 10% of ABC. In the case of DPWH, it has updated its Contractors Info (CI) in the registry of contractors, including status of on-going projects. If necessary, it is nominating sub-contractors for specified parts of the works. In the case of a JV, it is submitting its JV agreement and special JV license from PCAB.
Determination of eligibility
RECEIPT AND OPENING OF TECH. AND FIN. ENVELOPES AND PREL EXAM 1/5
Components of Bid
Technical Proposal Financial Proposal Bid Security* Authority of signing official* Construction schedule and S-curve Construction methods Organizational chart for the contract* Contractors certification on key personnel for the contract (vs. min. experience requirements)*
RECEIPT AND OPENING OF TECH. AND FIN. ENVELOPES AND PREL EXAM 2/5
7. Manpower utilization schedule 8. List of equipment pledged to the contract (vs. min. reqts)* 9. Equipment utilization schedule. 10. Affidavit of site inspection. 11. Credit line commitment/cash deposit cert (10% of ABC). 12. Construction safety and health program of contractor. 13. Affidavit of compliance with labor laws and standards.* 14. Affidavit of compliance with contractors responsibilities under IRR Sec. 17.7.1.* 15. Affidavit of compliance w/ Disclosure provision under IRR Sec. 47.* 16. Other requirements specified in ITB.
RECEIPT AND OPENING OF TECH. AND FIN. ENVELOPES AND PREL. EXAM 3/5
Contents of Financial Proposal
1. Bid prices in the BOQ.* 2. Detailed estimates.* 3. Cash flow and payments schedule.*
Bid Security
Form Min. amount Cash, certified check, cashiers check, managers check, bank draft, L/C -----------1.0% of ABC Bank guarantee --------------------------------1.5% of ABC Surety bond ------------------------------------2.5% of ABC Foreign government guarantee -------------- 100.0% of ABC
* Proposed in new IRR
RECEIPT AND OPENING OF TECH. AND FIN. ENVELOPES AND PREL. EXAM 4/5
Validity Period for Bids and Bids Security Reasonable period as indicated in the BDs.
Not exceeding 120 days.
RECEIPT AND OPENING OF TECH. AND FIN. ENVELOPES AND PREL. EXAM 5/5
Preliminary Examination of Bids
Check Tech. Proposal vs. checklist to determine the presence (pass) or absence (fail) of required documents. If Tech. Proposal passes, check Fin. Proposal vs. checklist to determine the presence or absence of required documents. Only the passing Tech. and Fin. Proposals will proceed to the detailed bids evaluation.
Bid must be complete: all required items in the BDs, including pay items in the BOQ, must be priced. Bid shall be corrected for arithmetical errors, inconsistencies, omissions and allowed discounts, to arrive at the calculated bids. Bids are deemed to include all taxes.
Any total calculated bid exceeding ABC shall be disqualified. Rank the total calculated bids from the lowest to the highest. The lowest is the LCB.
If bidder passes the post-qualification requirements, BAC declares it as the bidder with the LCRB.
AWARD OF CONTRACT
Procedure
BAC issues Resolution of Award to Bidder with LCRB, based on Bid Evaluation Report and Post-Qualification Report. HOPE approves Resolution. BAC prepares Notice of Award (NOA), HOPE signs it, BAC issues NOA to winning bidder and posts it at website.
1. Contract Agreement (use standard form in SBDs) by PE 2. Documents forming part of the Contract Agreement:
a. Bidding Documents for the Contract by PE (1) GCC (5) IAEB (2) SCC (6) ITB (3) Drawings/Plans (7) BDS (4) Specs (8) Bid Bulletins (Addenda) b. Contractors calculated bid in the Bid form, including Tech and Financial Proposals by PE c. Contractors LOI (and CI from the DPWH Registry) by PE
B. Supporting Documents
1. Approved Program of Work 2. Obligation Request 3. Abstract of Bids as Calculated 4. Approved BAC Resolution declaring the LCRB and recommending award
Contract Signing
Deliver ROW and government-furnished materials/equipment/plans Carry out works per contract, including start and completion dates, key personnel, etc.
Sub-contracting (GCC 8)
Warranty Period
Under Warranty Security
Project Completion
1 year
Final Acceptance
2/5/15 years
Contractor assumes full responsibility except those occasioned by force majeure Repair within 90 days.
Contractor shall be responsible for structural defects except those caused by third parties or force majeure. Contractor is required to put up a warranty security, the form of which shall be specified by the BAC.
Per RA 9285. Before end of defects liability period. 15% max in lump sum, or upon NTP and upon mobilization, covered by Performance Security, recouped from progress payments.
To cover cumulative value of work accomplished. Certified by entitys rep, net of previous payment, retention, etc.
To cover uncorrected defects and third party liabilities. 10% on progress payment. Cumulative VOs not > 10% of original contract price; or another contract HOPE may authorize VO beyond 10%, but not > 20%, with sanctions on designer/official responsible. Entity may suspend for: force majeure, contractors failure to correct bad/unsafe conditions or carry out valid orders, changes in plans. Contractor may suspend for: non-delivery of govt materials, non-payment of contractor within 45 days, adverse peace and order.
Only when activities fall along the critical path of approved PERT/CPM. Not for unfavorable weather or reasons already factored in the contract duration, or inexcusable failure of contractor to provide eqpt/materials. No contract price adjustment or escalation, except for extraordinary circumstances determined by NEDA and approved by GPPB. Extraordinary circumstances under Civil Code:
a. Ordinary fortuitous events typhoons, flooding, vehicular accidents, etc b. Extraordinary inflation or deflation at least 2 standard deviations. c. Extraordinary fortuitous events fire, war, pestilence, earthquake, etc.
At end of defects liability period. Deadline, amount to be withheld for failure to submit by deadline.
Intended completion date (GCC 1.17) Procuring Entity (GCC 1.22) Procuring Entitys Representative (GCC 1.23) Start date (GCC 1.28) Description of the works (GCC 1.31) Dates of delivery of the works (GCC 5.1) Contractors key personnel (GCC 6.5) Site investigation reports (GCC 10.1) Type of structure and warranty period (GCC 12.3) Date of submission of as-built drawings (GCC 50.1) Amt to be w/held for failure to submit as-built drawings (GCC 50.2)
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In accordance with appropriate national/intl standards and accepted engineering design practices. E.g., at DPWH, design standards shall be based on:
DPWH Design Guidelines, Criteria and Standards (Orange Book) American Association of State Highway and Transportation Officials (AASHTO) for Highways and Bridges American Concrete Institute (ACI) Standards Technical Standards and Guidelines for Planning and Design of Flood Control, 2002, by Flood Control & Sabo Engg Center (FCSEC), DPWH National Structural Code of the Philippines Other relevant guidelines and standards
May include aerial, hydrographic, topographic, hydrologic, subsurface, monumenting, geological, soils and materials, parcellary and other surveys. In accordance with agency guidelines, criteria, standards - e.g., DPWH Orange Book. Should provide input data for design and production of plans to permit quantity estimates with +/- 5 to 10% accuracy.
sections - are manipulated to overstate the quantities in the design especially for earthworks. data.
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Major items are deliberately omitted in the design, necessitating variation orders during implementation.
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Use internationally/nationally accepted specs, e.g., DPWH Standard Specs for Public Works & Highways, 1995/2004 (Blue Book) Description of work Material requirements Construction requirements Measurements and payments
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Estimates with accuracy of +/- 5 to 10% of final quantities. Bill of Quantities (BOQ) is discussed below. Unit prices for work items based on market prices. ABC is discussed below. Include estimates of work items, quantities and costs, and PERT/CPM diagram of project activities*.
Depends on kind and size of the project. Preferably small packages, without impairing tech. integrity. No splitting to circumvent laws and rules.
Based on parcellary and socio-economic surveys. Land Acquisition and Resettlement Action Plans (LARAP) should be prepared in coordination with LGUs/NHA.
Packages are too large vs. norms: limits participation to few big contractors.
Splitting to bring bidding to lower offices, where rigging is deemed easier to arrange.
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Refer to model LAPRAP document (DPWH) and RA 8794 and its IRR. Check (a) land titles with RD, LRA, BL; (b) land prices vs. BIR zonal values and market prices; and (c) improvement costs vs. replacement costs. Prepare resettlement plan with suitable site, compensation, and action program in coordination with LGUs and NHA. Ensure families are resettled before bidding.
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Include electric, water, sewerage, telephone, drainage, and other utilities affected by the project. Done for a environmentally critical project or project in an environmentally critical area as defined by DENR.
l. Preparation of EIS
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Types, numbers and capacities of equipment based on: Nature, volume, timeframe of works to be done. Equipment productivity. Equipment cost (capital and O&M) per unit output. Utilization and operation of equipment for the works to conform with technical specs (e.g., DPWH Blue book).
Production and efficiency rates for major equipment are substantially understated vs. norms. These result in:
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VE will analyze alternative schemes of achieving project objectives to delete/reduce non-essential features and lessen lifecycle costs of the project, without sacrificing its structural quality and integrity, while attaining its essential function, performance and safety.
TOR for FS and DE does not include VE. QA check shows VE was not adequately done according to standards, or not done all. Consequently,
Over-designed projects could not be checked. Opportunities for significant savings are missed.
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Allow for rainy/unworkable days based on PAGASA records. Check if reasonable considering industry experience.
p. Warranty period
2/5/15 years depending on type of project. Included in conditions of contract (GCC and SCC).
Discussed in Module 5.
As provided in Annex G, RA 9184 IRR: Agency sets designconstruction performance specs, and contractor undertakes design and construction. For fast-track projects, advanced technologies, small projects. Advantages: single responsibility, faster, promotes innovation and high quality, less administrative burden, firm costs, less collusion.
Contract duration is too long compared to industry practice and experience. This drives up the costs.
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Parts to be provided by the Procuring Entity: Pay items with corresponding descriptions, units of measurement, and quantities. Parts to be provided by the bidder as its bid: Unit bid prices and total bid prices corresponding to he pay items.
404
Reinforcing steel
33,793
kg
405(1)
Structural concrete
242
cu. m
(1) I II III
IV V VI VII VIII IX X
(2) Earthworks Soil Poisoning Reinforced Concrete a. Concrete b. Reinforcing Steel Bars Masonry Works Fabricated Materials and Hardware Cement Plaster Finish Painting Works Roof Framing Corrugated Metal Roofing Roof Insulation Total
(3) lot sq. m cu. m kg sq. m lot sq. m lot lot lot lot
ABC (total and unit prices) substantially exceed benchmark prices by 15-30%. If no quality assurance is done, quantities could be bloated using manipulated survey and design data thus padding the ABC. Equipment production/efficiency rates are understated; material sources are too far; wastage is too large; indirect costs are unusually high thus jacking up the prices. Agency has no trained estimators. VAT is double counted, especially for input materials. 74
Modes of Undertaking DE
Performed in-house by procuring/end-user entity if it has the technical capacity to do so. Assigned to specialized government agency (usually through Memo of Agreement) e.g., DPWH if the entity is not capable by itself to do the DE. Outsourced to engineering design consultants, especially for large and complex projects.